Whitacre leaving General Motors

UPDATED--Ed Whitacre is stepping down as General Motors Co. CEO on Sept. 1. He will be replaced by Daniel Akerson, who joined the GM board in July 2009 after a long career in telecommunications.

Akerson, 61, has been head of global buyouts for private equity firm The Carlyle Group since July 2009. His career was highlighted by stints as chairman and CEO of XO Communications from 1999 to 2003. He was CEO of Nextel Communications Inc. from 1996 to 1999 and also was chairman of the company's board from 1996 to 2001.

Whitacre, 68, said he would stay on as chairman until Dec. 31. When he leaves, Akerson will become chairman as well, Whitacre said during a conference call with analysts and reporters on Thursday.

Whitacre said the GM board has been aware since he became CEO in December that he didn't want to stay a day longer than he had to. Whitacre was named GM chairman in June 2009 and took over as CEO after the Dec. 1 departure Fritz Henderson.

Deep bench

Whitacre said he and the board had complete confidence in Akerson, who has kept close tabs on operations since he joined the board in July 2009.

Akerson said he and Whitacre share a common vision for GM. He declined to list priorities or comment on any additional changes in management, except to salute Whitacre for the overhaul he's made and the strong management cadre currently in place.

"It's a broad and deep bench," Akerson said.

Surprise announcement

The departure of Whitacre, who has served just eight months as CEO, had been expected but the timing of the announcement was a surprise and came just a day ahead of GM's expected filing for a landmark stock offering.

Whitacre, who continued to commute from his home in Texas during his stint as CEO, had said repeatedly that he would be an interim leader at GM.

"It was obvious that I was not going to be at GM for the long haul," Whitacre said at the end of a conference call to discuss the company's second-quarter earnings. "We have put a strong foundation in place, so I am very comfortable with my timing."

More challenges ahead

Akerson will become GM's fourth chief executive in just 18 months as the automaker frees itself from the U.S. government's 61 percent ownership after last year's $50 billion taxpayer bailout. The company is seeking to raise $12 billion to $16 billion this year in an initial public offering, said a person familiar with the plan.

“Dan Akerson is a very good person to take the company through the IPO,” Rebecca Lindland, an analyst at IHS Automotive, said on Bloomberg television. “While he hasn't led a traditional manufacturing company before, he certainly has the credentials to lead any company going through changes in its financial structure.”

Whitacre, known for building AT&T Inc. into the biggest U.S. provider of telephone service, had described steering the nation's largest automaker after bankruptcy as “a public service.”

Second-quarter profit

GM on Thursday reported second-quarter net income of $1.3 billion as vehicle sales and production increased--a gain from $865 million in net income during the first three months of the year. Revenue increased 44 percent from a year ago to $33.2 billion on growing sales of the Buick Excelle in China and Chevrolet Equinox in the U.S., the company said in a statement.

“Results like these make it clear that the new GM is on the right track with good momentum behind us and a bright future ahead of us,” Whitacre said. “And also it gives me a lot of confidence to begin transitioning in new leadership at General Motors.”

GM's IPO would be the second-largest in U.S. history, behind Visa Inc.'s $19.7 billion initial offering in March 2008. The company aims to sell a fifth of the Treasury's stake, reducing the U.S. to a minority owner, two people familiar with the plan said in June.

Credit line

GM also has obtained a $5 billion revolving line of credit from a group of at least 15 banks, Bloomberg reported. More than half of the banks are named in the draft of the document as underwriters, including Morgan Stanley, JPMorgan Chase & Co., Citigroup Inc., Bank of America Corp. and Credit Suisse Group AG.

The automaker last month agreed to buy subprime lender AmeriCredit Corp. for $3.5 billion to help it reach more customers with leases and loans to borrowers with faulty credit records. Whitacre had wanted to buy or start a lending arm before a fourth-quarter initial public offering, people familiar with the matter said in May.

Akerson has “been involved in every decision that has been made,” said Joe Phillippi, principal of AutoTrends Inc., a consulting firm in Short Hills, N.J. “You can say the management moves at GM are as much his as Ed Whitacre's.”

Akerson is unlikely to start changing GM's management and is the “least disruptive” of the changes at the top of GM since March 2009, he said.

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